This decision by the Second Department is not unusual: it is not uncommon to see foreclosure litigation turning into a discussion of the trust’s failure to pursue its rights diligently—or at all.
Still, it struck me as emblematic of how trustees and servicers treat protecting a trust’s rights. As the Second Department noted, the servicer’s excuse that it “did not refer this action to the law firm retained by Deutsche Bank ‘due to confusion regarding the multiple cases filed in multiple counties’ was conclusory and unsubstantiated and, under the circumstances of this case, did not constitute a reasonable excuse for Deutsche Bank’s default.”
But of course, unless an investor makes an issue of it, nothing is going to happen to the trustee or the servicer: it is just another loss for investors.